Do you think our 21st century society can actually afford the full welfare state ideal?

[TheOtherBoleynGirls]

First things first, I want us to have a full welfare state. I think being able to provide everybody in a country with equal education, equal healthcare, and an equal safety net in times of trouble and illness is the absolute ideal.

But looking at the state our economy is in, do you think that dream is still achievable, with the right taxes and financial management, or do you think it might be a post-war ideal that is economically unviable for a country in the long run?

YABU - we can afford it if everything is managed correctly

YANBU - it’s a great but inevitably impractical idea

Everyone wants an ideal welfare state.

It's just that no one wants to pay for it.

Who should pay for it ? Not me. The rich. aka anyone richer than me.

THIS.

The biggest problem with debate on this issue is that people are mentally stuck in a box where they can only see as far as income tax. When the issue is framed in those terms, the super-rich (who are not dependent on the kind of income that creates income tax liability) have already won.

Capital is by definition secondary to income in terms of the urgent need to support people's livelihoods. Many people just earn enough income to pay for rent and food from month to month. Some earn a bit more and that surplus becomes capital, which may then show up in home ownership, multiple home ownership accruing rent, or business ownership. Some of that capital then gets inherited and shows up in long term patterns of class, how much different groups of people need to work at all, what their educational prospects are like etc.

A lot of people have this weird idea that taxing capital is worse because it's taxing money "twice". It isn't, because you're only taxed on the capital GAIN - the part that has been accrued between acquiring the capital in the first place and the moment of tax liability. Taxing income is far worse because it's taxing the first-line money that poor people need to live on, that is directly related to personal effort and endevour. As you go through various stages of capital accumulation, both that necessity for livelihood and the relationship with personal effort become more tenuous.

The fact that capital is taxed at lower rates than income in the UK is an obscenity.

But the point is it's the UK tax system that allows them to do that, and we could change that easily if we had the will. In fact your example is a good one, since property and land ownership are the easiest things to tax separately from place of domicile. It's not like said billionaire can just pick up all his Mayfair town houses and plonk them in Switzerland.

That’s very true

We can easily afford it, and a lot more.

I worked in the NHS with the Thatcher and then John Major years, so many crap policies that were implemented to make the NHS less efficient.

Example

If you don't spend your whole budget in a year we will take what hasn't been spent off you next year. So Hospitals had to find ways to spend money and couldn't save for the next year.

Lots of decorating and retarmacking of car parks took place. One old hospital was closed and about to be demolished but it got completely redecorated.

Then 'patient events' - so if you develop an infection after an operation thee hospital was incentivized to send you home and tell you to come back the next day instead of keeping you in.

More recently they stopped agency workers from claiming expenses because, "it wasn't fair".

Previously I'd taken a job 200 miles away, it was a temporary job and the only way I could do it was to stay in a hotel and do a weekly commute.

I couldn't do that now unless the college paid not just my wages but for accommodation, but they can't do that. A couple of years later I was offered double my usual rate to teach 70 miles away, it wasn't enough to cover my expenses, so the college didn't get a teacher and I didn't get the job.

It's all taking money away from the bottom and the top just get richer and richer.

The welfare state emerged in 1947, although there were models trialled before that. It was both welcome and necessary in the post-war context. One of the driving factors was the fact that many men of serving age, were unfit for military service due to preventable causes such as poor nutrition, preventable childhood diseases, illnesses associated with neglect and poverty (primarily social causes). Another factor was the need for the UK to focus on the health and education of its population, the world was changing, and the UK's position in the world had changed.

Now, we need a slightly different model. Health is vitally important, but good social care is intricately linked to good health. Social care and related services can also help individuals to access education on a more equal basis. The current health service is also imperfect and there as significant health inequalities between the general population and people with learning disabilities, serious mental illnesses or autism, for example.

Our society has changed in the 75 years since the inception of the NHS and the welfare state. Investment, including adequate pay for carers and other who work in social care is required. Greater investment in providing places in the community for the elderly and chronically ill to live, or to support them to live well in their own homes, would ease the burden in hospital wards somewhat.

So, in my opinion, we need to refocus the targeting of funds to represent a more social model of economics.

The super rich are generally very mobile. My friend works for a multi billionaire who owns numerous properties in the UK and abroad, all will be in trusts and companies. This person has just moved to Switzerland to avoid UK taxes in the event of Labour taking over.
Rubbish. Not got much business acumen if they are moving now.
Who is this mythical friend who knows the financial secrets of a billionaire 😂

we're also missing the shear amount of inefficiency in having to manage a laundry list of different schemes and processes (housing assistance, unemployment, disability allowances, carers allowances, child benefit, state pension, the list is massive).

a basic income amount could be calculated, for everybody, with adjustments for differing requirements (disabilities/long-term sickness etc), with which people can manage as though it was a paid salary.

one system, one way of applying, one regular payment to the recipient, one place to make changes/amendments when circumstances change.

this would be much more efficient than the multiple sources of money there are now.

additionally it removes much of the possibility for people to game the various (sometimes conflicting/overlapping) systems to their advantage.

and on top of that, it makes things much easier for more vulnerable people who currently miss out on support because they do not have the ability/confidence/patience/time to apply for multiple programmes.

I believe we can afford it, but we need to be careful the birth rate doesn't drop too low (see South Korea, for instance) OR immigration doesn't drop too low. We need one or the other, preferably both.

We need a steady inflow of young taxpayers to support the current and upcoming pensioners (the boomers, essentially), then after 1964 the birth rate dropped, so our birth rate might be able to keep up with pensions. But not if we cut education funding so badly that too many of the rising generation are low or non-earning. We'd need massive immigration then.

We need a big, educated and employed middle class to pay for the people at either end, which is absolutely fine, but the birth rate has dropped off a cliff since 2010 and if we look at Korea as a sign of what's to come (low birth rate, low immigration), I don't know if we can afford a welfare state then.

I see the birth rate as the metric to watch, not how much money there is, because there is clearly plenty of it right now, just unfairly distributed.

but surely the birth rates are already too low & even if they improved (unlikely with col & housing) it will be years to see the impact

there's already more over 65s than u15s with over 65s going to grow.

Your imagination must be very limited if you cannot believe that someone knows someone super rich who is planning to pay less tax. The super rich are not unicorns and tax planning is not a mythical concept.

Yeh wish they would incentivise having children as they do in France or italy. These type of things would quickly persuade me to have #4:

• free nursery of 50% funded until school age;
• transfer tax allowance to husband if don't work;
• £1-5k bonus amount per baby born;
• gift vouchers for baby kit, baby clothes and food for the first year (when hardest for work)

If each woman could claim twice say over a 10Y period, it would cost the government max £3k per baby so max £60k per family. Not a lot is if ?

Birth rate would explode I'm sure. I know so many people with 1 or 2 children in south east who haven't had more due to work and childcwre costs (not housing most people don't mind kids sharing)

The British seem to absolutely hate children is the impression we give to most people around the world. We do so little to support families it’s embarrassing.

We don’t need to incentivise having children. People that want children will do it anyway and there are already enough people on this planet.

What we need to do is provide heavily subsidised childcare so that people have the children they can afford based on their own earned income.

It's completely unaffordable and we'll end up in a situation where 40% of the country are working paying 60% tax so that 60% of the country can get the same income in benefits as those who work. It will all collapse. The idea that workers should expect to now pay more tax so that benefits go up by 10% is just nuts. People will just quit work or go part-time.

Honesy, I don't think we can.

1. Elderly population bulge
2. Falling birth rate
3. Rising costs of health care - the complexity of medical treatment now Vs at the inception of the NHS, and the associated higher costs as a result.

By the time those under 15s reach working age a lot of today’s over 65s will be dead. Once we (the boomer bulge) have gone you’ll all be fine.

What would you like to cut?

I would go after pensions as everyone has the chance to save for a private one
Make income protection insurance mandatory.
Slash benefits to the bare bones even consider replacing them with food stamps and rent paid to landlords
Cut basic care from the NHS so we pay a fee for minor things like one off GP appointments and keep the funding for more complex thing less people are likely to be able to afford. It's easier finding £100 for a GP appointment than £250k for cancer treatment.

The increase in NICs would have

raised an extra £13billion.

A similar increase in income tax would raise more.

I think you can get sensible levels of taxation without making massive increases and as a result we’d have better public services including education making companies more likely to invest here.

we could have more targeted taxation of wealth and an overhaul of council tax (hasn’t been properly touched since 1991?) but politicians haven’t got the actual guts to do some evidenced based work on this.

Instead we hear bullshit about the Laffer curve, which was made up by an economist trying to protect rich people. The economist who came from the same group as those who Liz Truss loved.

noone has done the actual donkey work to demonstrate if it is or isn’t possible.

I don't really know what the answer is but I think the whole system needs restructuring.
I think constantly relying on 'the rich' to pay more isnt the way to solve it, I think our tax rates are already high at 40 percent over 50 odd grand.
I think 40 percent of someones money is such an awful lot.
And people still moan it's not enough even though they don't contribute no where near as much.
And then the rate going up to 45 percent with their personal allowance taken away.

I know alot of people that don't save into private pensions and aren't thinking ahead for old age.

I know alot of people who are completely financially irresponsible, buying things way out of their means.

I think 40 percent of someones money is such an awful lot.

When I started work the basic rate was 33% it went up to 35% two years later. Top rate was 93%.

First of all, what makes you think the rich are always rich? They aren’t (I currently earn over £70k, I didn’t always earn that and have earned more) so why not shift more burden that way - because they benefit from decent public services. They don’t become destitute with a 45% tax rate.

Second of all it is not 40% of all of their money over £50k. Logically how would that work? Otherwise they’d have less cash than someone on £49.99k. Tax lessons are needed at school!!!

Thirdly, there are other taxes, not just income tax.

Fourthly; there’s a lot of wealth around (we are one of the richest countries) - don’t you ever wonder where it’s gone?

This, with bells on!

We have a government that wants us to believe we can't afford it because they are ideologically opposed to it. Looking at the voting on this post it seems a frightening number of people believe them.